Refinancing Pushes Mortgage Applications Higher

Falling interest rates rejuvenated home owner’s interest in refinancing as mortgage applications jumped by over six percent last week according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 25th, 2013.

The Market Composite Index, which measures mortgage loan application volume including purchase applications and refinance applications, increased 6.4 percent last week and follows a 0.6 percent decline the week before.

On an unadjusted basis, mortgage loan application volume increased by six percent from the previous week after declining by one percent the week before.

Purchase Applications:

The seasonally adjusted Purchase Index increased by two percent after posting a one percent increase the week before. The unadjusted Purchase Index was also two percent higher than the previous week but was still 0.1 percent lower than during the same period last year. It was the fifth consecutive week that mortgage applications for home purchases fell below the previous year’s levels.

Refinance Applications:

The Refinance Index increased by nine percent from the previous week after posting a one percent decline the week before. The refinance share of mortgage activity increased to 67 percent of total applications from 65 percent the week before.

Mortgage Interest Rates:
 

Average Contract Mortgages Rates
(80% loan-to-value)

Type of
Loan

Interest Rate (%)

Points

Effective Rate

Current

Previous

Current

Previous

30-Year FRM Conforming
($417,500 or less)

4.33

4.39

0.26

0.41

Decreased

30-Year FRM Non-Conforming
($417,501 or more)

4.36

4.43

0.27

0.26

Decreased

15-Year FRM

3.42

3.51

0.30

0.30

Decreased

FHA 30-Year

4.06

4.15

0.17

0.27

Decreased

5/1 ARM

3.17

3.25

0.38

0.26

Decreased

 
The adjustable-rate mortgage (ARM) share of activity remained at about seven percent of total applications.

Tags: MBA, home purchase applications, mortgage rates, fixed rate mortgage, adjustable rate mortgage, refinance, interest rate, FHA mortgage rates

Source:
Mortgage Bankers Association

Reported by Chris Moore